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More Corporations Preclude Class Actions Lawsuits After Supremes Give the OK

Posted on October 24th, 2012

Class action lawsuits can afford plaintiffs the opportunity to level the playing field against large corporations who engage in actions that harm employees and consumers. When the damages due to a single plaintiff are too low to support the litigation costs of an individual lawsuit, a class of people similarly situated banning together to right a wrong can be an efficient means to obtain redress.

Last session, the United States Supreme Court weakened consumer protection laws in AT&T Mobility v. Concepcion, 563 U.S. ___ (2011). In that case, a 5-4 majority penned by Justice Scalia held the federal Arbitration Act took precedence over state laws and allowed corporations to limit class action lawsuits in consumer contracts. The court was divided on familiar lines, with Justice Breyer penning the dissent to which Kagan, Sotamayor, and Ginsburg joined.

Not surprisingly, this has led to a flood of corporate contract changes to preclude individuals from filing a class action lawsuit and represents a step back for wronged consumers and employees.  Since the decision, numerous corporations have added arbitration clauses curbing class action lawsuits, including companies such as PayPal, Netflix, Sony, Valve, eBay and Microsoft.  While some are offering “opt-outs” to the arbitration programs, these “opt-outs” are merely illusory since they require multiple steps (with such steps often hidden with fine print) by the consumer to secure the right to file a class action lawsuit.  Moreover, careful reading of fine print is not something these corporations expect consumers to actually do.

Our plaintiff eDiscovery experts are like-minded legal and IT professionals who understand that class action lawsuits offer recourse and remedies that would not otherwise be available to individuals.  It is essential to keep the courthouse door open to anyone with a valid grievance, and the actions of corporations after AT&T Mobility only demonstrate they are all too eager to slam the class action door shut and to maintaining an uneven playing field.

ILS – Plaintiff Electronic Discovery Firm

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